CAIRO: Egypt’s language skills and good working relationships between government, business and academia make it a strategic choice for growth, an IBM executive in charge of Egyptian business process operations (BPO) said.
Egypt is eager to develop its IT and related sectors with a view to bringing in $10 billion a year from offshoring by 2020.
"Egypt is one of the strategic locations we have to improve our global footprint for BPO," Egypt business process delivery manager David Brooks said in an interview on Wednesday.
Brooks, who worked for IBM in South Africa for four years, said Egypt had better cooperation between industry, government and universities and a broader cache of languages to draw on.
"In Egypt you get French, German, Italian, Spanish, some Japanese, some Russian — a wide range of languages," he said.
While IBM’s BPO operations in Egypt are dwarfed by its presence in global giants such as India and the Philippines, it is entrenched in the country and helping educate its graduates.
Foreign investors sometimes complain of a skills gap in Egypt and say they have to pay a premium to secure recruits with the right technical and language skills.
"Our strategy says English will go to India, but for any client (with diverse language needs) happy with near native (language skills) we would certainly recommend Egypt as a destination for a BPO business."
Brooks said IBM has 32,000 BPO employees in India and around 600 in Egypt. "It is very small but it is just growing."
Technology firm executives see growth potential in the Arabic web, while tech-savvy youngsters with native Arabic and additional languages are a vital resource.
Illustrating the point, IBM last month inked a deal to provide web portal Yahoo with customer care services for Europe, the Middle East and North Africa.
Yahoo had pitched to the market without a location specified and IBM won the contract by pitching Egypt, Brooks said.
Yahoo bought Arabic-language portal Maktoob.com last year.
Wage inflation risk limited
An International Labor Organization (ILO) study published this month said offshoring and outsourcing has been a boon to developing countries, offering double the average pay in other areas of the formal economy.
Brooks said he is not worried wage inflation could spiral, as is happening in India, as Egypt is churning out more than 300,000 graduates a year, many eager to enter what is perceived as a solid industry with promise of career progression.
"As long as the government and the universities continue to feed the marketplace with all these thousands and thousands of new graduates that speak the languages there is no need for me to try to attract people from competitors," he said.
In addition to IBM’s relatively new Egypt BPO unit, the firm also established a nanotechnology centre with a $30 million joint investment with the government in 2009.
"The nanotechnology lab is sending Egyptian scientists and experts out to IBM’s labs in Zurich and New York and across in California, that’s got to be pretty important for Egypt and for Egyptians," he said.